German business confidence drops over virus fears
Berlin, July 26: German businesses are unexpectedly feeling less confident about the future than they were in previous months of this year, according to the Munich-based Ifo insitute's monthly assessment of managers' morale.
Ifo's confidence barometer fell to 100.8 points in July, down from 101.7 in June. It is the first drop since January.
Analysts had expected the closely watched survey to go 0.3 points higher.
Virus continues to weigh on the mind
According to Ifo, managers from the some 9,000 businesses covered in the survey were positive about their current situation but looked to the coming six months with increasing worry. Their main concerns, according to the institute, were bottlenecks in the supply of raw materials and fears that COVID-19 infections could resurge.
Although the infection rate in Germany is still relatively low compared with some other European countries, it has been on its way up again since early July.
The resurgence is being driven by the delta variant of the coronavirus, which is more infectious than the ancestral version and has now become dominant in many nations, including Germany.